![[NASA Logo]](../Images/nasaball.gif) |
NASA Procedures and Guidelines |
||||
This Document is Obsolete and Is No Longer Used.
|
|||||
|
|
|||||
|
|
||||
| | TOC | Preface | Chapter1 | Chapter2 | Chapter3 | Chapter4 | Chapter5 | Chapter6 | AppendixA | AppendixB | AppendixC | ALL | | |||||
2.1.1 Identification and Recognition. SFFAS No. 1 requires a receivable be recognized when NASA establishes a claim to cash or other assets against other entities either based on legal provisions, such as a legislative requirement, a payment due date, or goods or services provided. If the exact amount is unknown, a reasonable estimate should be made.
2.1.2 Recognition of Adjustments and Correction to Accounts Receivable. Adjustments or corrections to accounts receivable should be posted as soon as possible and in the accounting period in which the adjustments or corrections occur. If adjustments or corrections affect transaction amounts, due dates, or any other terms for the receivable, NASA shall notify the debtor.
2.1.3 General Accounting for Receivables. Accounting records for receivables will be maintained so that all transactions affecting the receivables are included in the reporting period in which they occur. Receivables will be recorded, maintained, and reported in accordance with the USSGL. The first six digits of the accounts receivable general ledger will conform to the USSGL chart of accounts.
2.1.4 Internal Controls. Adequate internal controls will be in place to ensure accurate recording and maintenance of accounts receivables. Appropriate segregation of duties will be maintained which requires several individuals to be involved in the recording and reporting of public and intragovernmental accounts receivable activity. The Center CFO and the NSSC are responsible for ensuring a commond understanding of each party's roles and responsibilities soaccounts receivable are recorded, aged, written-off, or closed-out as required in this chapter. Major categories of receivables (reimbursable agreements, contract refunds, travel refunds, payroll, etc.) will be maintained to facilitate clear and full disclosure of accounts receivable including the name of the debtor, and the amount, age, and the type of debt. Subsidiary records will be reconciled to the control accounts on a monthly basis.
2.2.1 Identification and Recognition. Receivables due to NASA from other Federal entities are intragovernmental receivables and these receivables will be authorized and documented in a written reimbursable agreement between NASA and the ordering entity. The activity receiving the goods or services (ordering entity or customer) reimburses NASA. Amounts that do not represent liquidations of advances furnished by reimbursable customers are recorded as accounts receivable.
2.2.2 Accounting and Reporting Intragovernmental Receivables. SFFAS No. 1 requires NASA to report receivables from Federal entities (intragovernmental receivables) separately from receivables from public entities due to different legal and administrative requirements and concepts that apply to them. A receivable created from an agreement between NASA and other Federal agencies will be recorded in the month in which the associated revenue from the receivable is earned. Intragovernmental receivables and payables between NASA Centers will be eliminated against each other during the reporting process and will be excluded from any external reporting of receivables (e.g. TROR).
2.2.3 Debts owed by any Federal agency to NASA (intragovernmental receivables) are exempt from interest, penalty, and administrative charges.
2.2.4 Document Retention for Receivables. NASA Centers and the NSSC shall maintain accurate, and complete documentation related to accounts receivable records. This documentation serves as the basis for proper servicing of debt including pursuing collection of delinquent debt if accounts become overdue.
2.3.1 Identification and Recognition. Public receivables are claims of NASA against non-Federal entities. These non-Federal entities include the public, foreign Governments and companies, employees, and organizations outside the U.S. Government. Claims of NASA that will not be collected through liquidations of advances furnished by public entities are recorded as accounts receivable. Additionally, public receivables are created when interest accrues or a refund is identified.
2.3.2 Interest Receivable. If NASA does not receive payment for a public receivable by the due date then interest may accrue on the receivable and Interest Receivable will be recognized.
2.3.2.1 NASA shall recognize, as a receivable, accrued interest charges on accounts and loans receivable, as well as interest accrued on investment securities. Interest will be recognized on outstanding delinquent accounts receivable against persons or entities in accordance with provisions in 31 U.S.C. § 3717, Interest and Penalty Claims. Interest is accrued on outstanding debt when an amount due to NASA is not received by the established due date as described in Section 5.4 of this NPR.
2.3.2.2 Accounting for Interest Receivable. Interest receivable will be recorded by the NSSC for the amount of interest income earned but not received for an accounting period. These charges will continue to accrue until the debt is paid in full or otherwise resolved.
2.3.3 Refunds Receivable.
2.3.3.1 Refunds receivable are funds due to NASA that are directly related to, and will be a direct reduction of, a previously recorded expenditure. Thus, the recovery of an erroneous payment or overpayment which was erroneous at the time it was made qualifies as a refund to the appropriation originally charged. The rationale for crediting refunds to an appropriation account is to enable the account to be made whole for the overpayment that gave rise to the refund. Examples of refunds receivable include, but are not limited to the following:
a. Amounts due from commercial concerns due to erroneous billings, incorrectly computed invoices, or contract default.
b. Amounts due for items rejected or returned.
c. Recovery of amounts due on payments for contractual services when contracts are canceled and adjustments made for the unused portion.
d. Amounts due from employees as a result of erroneous or invalid amounts on a travel voucher.
e. The following types of refunds receivable related to employee pay and benefits:
(1) Salary overpayments.
(2) Amounts representing employee benefits paid by NASA while an employee is on Leave Without Pay (LWOP) status.
(3) Health and life insurance premiums when gross pay is insufficient to fund the deduction (such as when an employee is on LWOP and will pay NASA for health insurance premiums in order to keep the insurance in force.)
(4) Collectible court juror or witness reimbursements to employees while not in leave status.
(5) Leave taken in excess of leave earned at separation.
2.3.3.2 Accounting for Refunds Receivable. Payroll offices, legal offices, procurement offices, or any entity that determines a refund is due to NASA for an overpayment will notify the NSSC that an accounts receivable is to be recorded in the NASA core financial system. Such notification will be made in the same accounting cycle that the debt is recognized. There is not a separate account for refunds receivable in the USSGL. Refunds receivable are treated as accounts receivable.
2.3.4 Invalid Accounts Receivable
2.3.4.1 Recognition and Identification. NASA Centers and the NSSC shall review receivables for completeness, accuracy, and supportability on a quarterly basis. Abnormal or incorrect accounts receivable will be promptly researched and resolved. Entries that established receivables should be reversed when NASA determines that the receivable is invalid.
2.3.4.2 Accounting for Reversals. If a debt is to be reversed, the reversal will be recorded in the period in which the adjustment occurs.
2.4.1 Aging of receivables begins one day after the due date for both public and intragovernmental receivables. On a monthly basis the NSSC shall regularly run detailed aging schedules for all outstanding receivables by Center, analyze the open accounts receivable and make this data available to the Center CFO offices. The analysis should be performed prior to the normal monthly billing process. The original debt and any additional charges, included related administrative fees, interest, and penalties will all be aged as of the date the original debt became delinquent.
2.4.2 TROR Submission. The NSSC shall provide accounts receivable aging information to the Agency OCFO monthly and quarterly as part of their TROR and CMP submissions.
2.4.3 Aging Until Delinquent. Accounts Receivable will be aged at intervals from the due date until collected or determined to be uncollectible. NSSC shall maintain information on the number, amount, age, and collection status of accounts receivable and on uncollectible accounts, which, have been written off. When collection efforts are delayed or not successful, the NSSC should notify functional offices in order to avoid generating new receivables with debtors who have a history of delinquency or are unwilling or unable to pay.
2.5.1 The NSSC shall periodically (no less frequently than annually) calculate and adjust the allowance for uncollectible accounts receivable by fund for each Center (e.g. Allowance for Loss on Accounts Receivable, Allowance for Loss on Interest Receivable, and Allowance for Loss on Penalties, Fines, and Administrative Fees Receivable). The allowance for loss on accounts receivable applies only to public (non-Federal) debt, not intragovernmental receivables. Losses on receivables should be recognized when it is more likely than not (greater than 50 percent chance) that the receivables will not be completely collected.
2.5.2 Allowance accounts represent the estimated amount of uncollectible receivables which are used to reduce gross receivables by the amount of the estimated loss to their net realizable value. The net realizable value of the receivables is the receivables balance less the balances of corresponding allowance accounts.
2.5.3 Calculation of Allowance for Loss Balance. The balances of allowance accounts should be based on the history of write-offs for each delinquent age category recorded over the past two years. NSSC shall develop allowance percentages for each of the aging periods identified in
Part 1, Section C of the TROR. Each of the percentages developed is to be applied to the total value of non-Federal receivables (public) in that aging group.
2.6.1 Requirements for the write-off of public accounts receivable are established in OMB Circular A-129, Policies for Federal Credit Programs and Non-Tax Receivables. Generally, write-off is mandatory for public delinquent debt that has not been collected within two years of delinquency unless documented and justified to OMB in consultation with Treasury.
2.6.2 Exceptions for Mandatory Write-Off. In certain situations, debts could remain as assets and not written-off. In accordance with OMB Circular No. A-129, if NASA determines there are cases where material collections can be documented to occur after two years, debts cannot be written-off until the estimated collection becomes immaterial. When a Center believes a delinquent accounts receivable that is two-years old should not be written-off, the Center will submit a request for retention of the receivable to the Agency OCFO, Director for FMD. The request will include full documentation and justification for retention of the receivable. If the Agency OCFO concurs, the documentation and justification will be submitted to OMB for approval. Unless a determination is expressly made that the accounts receivable should not be written-off, the accounts receivable not collected within two years should be written-off.
2.6.3 Write-off is the process of removing accounts receivable from the financial records. NASA may write-off debt before two-years old due to any one of the following:
a. Reasonable collection actions have been exhausted (interpreted to mean "demand letters" have been sent in 30-day increments with no success).
b. The debt is delinquent by 120 days or more.
c. The debt has been referred to Treasury prior to 120 days delinquent.
d. The debt against the debtor has been discharged in bankruptcy.
e. There is more than a 50 percent chance that the receivable will result in a loss.
2.6.3.1 The basis for determining if there is more than 50 percent chance that the receivable will result in a loss is covered by the U.S. Treasury Federal Claims Collection Standards, 31 CFR pt. 903.3, Termination of Collection Activity. It includes, some basic conditions which include, but are not limited to:
a. NASA being unable to collect any substantial amount through its efforts or through the efforts of others.
b. NASA being unable to locate the debtor.
c. Costs of collection are anticipated to exceed the amount recoverable.
2.6.4 Debt in appeal or litigation. If the debt is being appealed by the debtor, is in litigation status, or for any other reason the collection activities have been suspended, and the debt has not been collected within two years, write-off of the debt is mandatory except for circumstances described above in which the Agency OCFO, Director for FMD, in consultation with OMB and Treasury determines that a debt is not to be written off.
2.7.1 Once NASA writes off a debt, it will be classified as Currently Not Collectible (CNC). While debts are in CNC status NASA should maintain the debt for administrative offset and other collection tools. All debt will be adequately reserved in the allowance account and all write-offs made through the proper allowance account. If at any time the amount of receivables to be written-off exceeds the balance in the allowance account, the allowance account will be increased before the receivables are written-off. Debts will not be written off directly to expense.
2.7.2 Reporting Debts in CNC Status. Debts in CNC status are reported on the TROR and are eligible for both offset and cross-servicing. During the period debts are classified as CNC, NASA should maintain the debt for administrative offset and other collection tools until whichever of the following occurs first:
a. The debt is paid.
b. The debt is closed out.
c. All collection actions are legally precluded.
d. The debt is sold.
2.7.3 Debt that is referred to Treasury will be classified as CNC until Treasury has notified NASA that collection activity is being terminated. Once Treasury has terminated collection activity, NASA shall classify the debt as close-out.
2.7.4 NASA shall maintain documentation related to write-offs to support the transaction.
2.8.1 Write-Off. Write-off is an accounting action that results in reporting the receivable as having no value on NASA's financial statements. When NASA writes-off a debt it should be classified as CNC when NASA intends to continue cost effective debt collection action.
2.8.2 Close-Out. Close-out is a collection action in which NASA stops collecting on a debt and all further debt collection actions are prohibited. NASA should close out a debt when it is determined that further debt collection actions are prohibited, legally barred, or no longer cost effective to pursue and neither NASA nor Treasury or any other institution plans on taking future actions to try to collect the debt. In most cases, the closed-out debt will be reported to the IRS in accordance with Section 6.8 of this NPR.
2.9.1 NASA does not need DOJ approval to write-off a debt of any amount since NASA is only adjusting its accounting records through write-off. Generally, write-off is mandatory for delinquent debts older than two-years old unless otherwise approved by OMB, therefore, NASA does not require DOJ approval authority to write-off debts older than two years. When writing off debts arising from reimbursable work performed for a non-Federal customer, Centers must ensure that the unreimbursed costs are charged to funds that were available at the time the costs were initially incurred.
2.9.2 Debts Outstanding Less than Two Years. When a debt is written-off in less than two years the circumstances are such that normally it is also reasonable to assume that the debt will not be collected. In such cases, NASA shall also cease collection and transfers the debt to Treasury or DOJ. Should circumstance suggest that further collection actions by NASA (on debts written-off within two years) will result in a collection the Agency OCFO, Director for FMD, must expressly approve continued collection efforts by NASA.
2.9.3 Debts can be written-off if outstanding for less than two years under the following conditions:
2.9.3.1 Debts of $100 or less. Center Deputy CFOs are authorized to periodically group, review, and approve write-off of debts where the amount of each debt is $100 or less (including interest, penalties, and administrative charges). This includes debts that have been substantially collected, but have small residual balances remaining and it is not cost effective to attempt collection. Such a review will be done periodically, but not less frequently than quarterly. The review and write-off of this debt should be accomplished prior to month-end close. Although debts whose amount is $100 or less are not individually significant, under no circumstances should internal controls be compromised by the write-off or reclassification of debt. Very small percentages of debt can frequently result in amounts that, while immaterial to the overall debt and write-off balances, are large enough to pose a risk of fraud and abuse. Adequate internal controls will be maintained.
2.9.3.2 Debts of $20,000 or less. Center CFOs are authorized to approve the write-off of individual accounts receivable with principal amounts not exceeding $20,000 that have been outstanding for less than two years.
2.9.3.3 Debts greater than $20,000. Center CFOs, with concurrence from the Center Director or designee, will submit write-off requests for individual delinquent debts with principal amounts greater than $20,000 to the Agency OCFO, Director for FMD, for approval.
2.9.4 Generally, write-off (while continuing collection efforts) is mandatory for public delinquent debt that has not been collected within two years. Explicit Center CFO approval or approval from the Agency, OCFO, Director for FMD, is not needed when the debt is two-years old. However, the Center CFO office, in consultation with NSSC, should review debts prior to two years in order to determine if additional collection efforts are warranted beyond two years. If the Center CFO or the NSSC believe it will be cost effective to continue collection efforts after two years for debts greater than $20,000, the debt will be referred to the Agency, OCFO, Director for FMD, before it reaches two-years old for a determination whether the debt meets the criteria to remain active. If a determination is made to keep the debt active the Agency OCFO, Director for FMD, shall justify retaining the receivable on the books to OMB in consultation with Treasury. If such a determination is not made explicitly by the Agency OCFO, Director for FMD, and the debt has not been collected within two years, write-off is mandatory.
2.9.5 Unless approvals are obtained in accordance with the section of this NPR describing close-out of debts, any debts not collected within two years that are written-off should remain in CNC status.
| TOC | Preface | Chapter1 | Chapter2 | Chapter3 | Chapter4 | Chapter5 | Chapter6 | AppendixA | AppendixB | AppendixC | ALL | |
| | NODIS Library | Financial Management(9000s) | Search | |